“IT spending remains recession-proof.” Thus spake John-David Lovelock, distinguished VP analyst at Gartner. This might raise eyebrows, given Big Tech’s big layoffs (more than 200,000 and counting) over the past 12 months. Lovelock’s views notwithstanding, Gartner very recently revised downward its 2022 forecast of 5.1% IT spending growth to just 2.4%. However, this apparent reversal belies the reality of where cuts are coming: The personal devices segment is declining, coupled with headwinds from a strong dollar, rather than diminished cloud/software spending, which is holding steady at 5.4%.
Even so, it might be too much to call IT spending “recession-proof.” In a cloud world, it’s unclear how any enterprise could cut their way to relevance. Cloud is a force multiplier for enterprise innovation. Cutting that, especially in a bad economy, is myopic, as enterprise buyers seem to recognize.
What, me worry?
Even David Heinemeier Hansson (DHH), cofounder of Basecamp and Hey, who blogged his adios to the cloud in October 2022, had all sorts of supposedly good reasons for leaving the flexibility of cloud infrastructure, perhaps most succinctly stated as, “Renting computers is (mostly) a bad deal for medium-sized companies like ours with stable growth.”
As I’ve noted, virtually no company on the planet fits that “stable growth”